Low customer preference Suppliers Powerhigh High Raw Material Prices Lack of

Low customer preference suppliers powerhigh high raw

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Increasing Demand for Steel. • Low customer preference. Suppliers’ Power(high) • High Raw Material Prices. • Lack of Transportation. • Fragmented Coke Suppliers. Competitive Rivalry(very high) • Competition from Foreign Players. • Spurt in Merger and Acquisition Activities.
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Threat of New Entrants (moderate) • High Cost of Basic Inputs and Services. • Industry is Capital Intensive. Threat of Substitutes(moderate) • Use of Aluminium, Plastic, Carbon Fibre 5. Obstacles in implementing operations strategy Opportunities: Availability of Raw material Consistency in final product due to advance level of automation for process control. Environmental Issues and air pollution Strong network of market (All product is marketed by M/s MMTC limited) Challenges behind Indian steel industry Volatile Steel price. Utilizing Maximum plant efficiency. Higher Energy Consumption as compared to international benchmark. Volatile demand and Supply. High Competitiveness among small Players. Lack of Product branding. India’s Steel Vision : Current Challenges : - 1) Construction, mainly housing sector, growth remains weak. Private sector investment has also fallen leading to low growth in capital formation.
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2) Domestic industrialization efforts have been challenged and slowed down by land availability and regulatory constraints. Large corporate debts are slowing down bank credits. Skill and infrastructure shortages are widespread. 3) Inadequate industrial development means India imports a lot of steel bearing products remaining a net indirect importer of steel. Opportunities in India’s Steel Space 1) India’s industrialization has just begun, thanks to Make in India programme. 2) The government is investing massively to build transport and industrial infrastructure. 3) Constraints in mining sector have been removed by specific policy tools. 4) Priority to domestic steel in government procurement will support steel production within. 5) Restructuring of stressed steel assets will bring them to production and support fresh investment in the industry. 6) New policies related to non-performing assets will ensure projects are better managed and the money is properly utilized to avoid cost and time overruns. Industry Concerns 1) Capital costs in steel plants are much higher than in China or Korea. 2) Much of industry’s financial issues are related to poor project conception and management. 3) Weak operational planning, inadequate margins for external adversities, poor resource management and rushing into actions without proper clearances have been the major reasons for cost and time overruns. Must be addressed adequately first.
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  • Spring '15
  • nauriyal

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